There are an extraordinary number and types of exchange traded funds that are available to individual investors to meet any investment objective. There are so many, however, that it’s useful to examine the categories so you can make a wiser choice for your particular needs. The following list is a simple summary of many of the most popular categories along with a few example ticker symbols seem able to look for when you go to Yahoo finance or MSN Money Central to do your due diligence. Remember, investing is not child’s play and you should consult a financial professional before making any decisions.
ETFs have useful variety. No matter what kind of ETF you need for your trading or investing interests, you are sure to be able to find an ETF that’s right for you. You can find ETFs that track:
broad indices: these are indexes like the Dow 30 industrial average, the S&P 500 index, and the NASDAQ 100. Their symbols are : DIA, SPY,and QQQQ. There are other major indexes like Japan Nikkei (EWJ), the European large-cap 350 (IEV) and the Morgan Stanley European and Asian mature company index (EFA). EFA is a particular favorite of mine because it represents the mature industrial world minus the US. major market sectors: these include ETF’s for the nine sectors of the S&P 500 known as the sector SPDRs or “Sector Spiders”. These ETF’s symbols begin with an ax and include finance, industrial, consumer staples, utilities, and technology among others. These are very high volume, very liquid and can be traded with options as well as in direct trading. regions of the world: these correspond to different regions of the world markets such as Asia less Japan (EPP), European and Asian mix (EFA), Latin America(ILF), and emerging markets (EEM) individual countries: there’re over 30 separate countries with their own ETF. These typically reflect the stock markets of each country comprising the largest capitalized companies. Just to name a few: Canada9EWC), Mexico(EWW) and one of my very favorites Brazil (EWZ). The Brazil ETF is very liquid and represents a country that is quickly turning into the economic powerhouse of Latin America in the Western Hemisphere. Business sectors: these include specific market segments such as semiconductors (SMH), utilities(XLU, UTH), regional banks (KRE), US residential real estate (RWR), biotechnology (BBH), medical devices (IHI) to name just a few. individual commodities & baskets of commodities: this is been a very hot sector over the last year and the run may be done. Commodities tend to be cyclical and very volatile at the end of long trends. You can either buy baskets like the Deutsche Bank commodities blend (DBC) or ETF that reflect individual commodities such as gold (GLD, IAU) or grains (DBA). currencies & currency pair trades: the seven major currencies of the Forex market can now be purchased as ETF’s including the US dollar n(USD). You could even get sophisticated pair trade ETF’s which play the difference between currency pairs. This is sophisticated trading that is not for novices. Morningstar style boxes: there are ETF’s the correspond to different styles according to them and MorningStar style box framework such as large-cap value or small-cap growth. proprietary fundamental screens: there are even ETF’s that reflect specific investment strategies and hypotheses. These all tend to be very sophisticated strategies and in order not to lead you astray I will refrain from reporting their symbols. It is enough to know that any philosophy of investment or trading can be framed with an appropriate set of ETF’s varieties of bonds and income-generating dividend payers: a couple easy ones are long-term treasuries (TLT) and aggregate income that mixes treasuries and corporate bonds (AGG) the entire world market.: a simple example is the vanguard total market Index viper (VTI)
With so many ETF to choose from you can be sure that there are some that will meet your every investment need.
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